Hollywood Bowl Group (BOWL) H2 2021 earnings summary

Executive summary

• Trading was limited to 25.6 weeks; post-reopening LFL revenue grew 28.6% vs FY2019, with strong demand and free cash flow.

• FY2021 revenue was £71.9m, adjusted EBITDA £30.6m, profit after tax £1.7m and year-end net cash £29.9m.

• Strong reopening performance, investment in the customer proposition and a robust balance sheet supported growth plans; COVID-19 restrictions remained an uncertainty.

Financial highlights

• Revenue £71.9m vs £79.5m in FY2020; gross profit £61.6m vs £67.9m.

• Gross margin 85.7% vs 85.5%; statutory operating profit margin 13.3% vs 12.4%.

• Adjusted EBITDA pre-IFRS 16 was £15.1m vs £14.0m; adjusted EBITDA including rent was £30.6m vs £29.8m.

• Operating profit £9.6m, profit before tax £0.5m and profit after tax £1.7m; FY2020 profit after tax was £1.4m.

• EPS 1.05p, up 22.2% YoY; government grant income was £2.8m.

Outlook and guidance

• First two months of FY2022 LFL revenue grew 38.1% vs FY2019; October half-term delivered record sales.

• At least high-single-digit LFL sales growth vs FY2019 expected, with continued COVID-19 restriction uncertainty.

• FY2022 plans include 4 new centres, 5–7 refurbishments, 16 Pins on Strings installations and ~£4m maintenance capex.

• Inflationary pressures include national living and minimum wages, food inputs and energy costs; refinancing is expected to lower interest costs.